Business in Turkey

As of 2023, unemployment rate will be reduced down to 5%, unregistered employment rate in non-agricultural sector will be under 15%, women’s employment participation rate will be increased to 41%, and child labor will be eliminated, according to government’s new “National Employment Strategy” published in the official gazette on 7th June 2017.

The target of the new strategy is;

Creating strong relations between education and labor market

Ensuring Flexicurity (flexibility and security) which strike a balance between flexibility and security in the labor market and help both workers and employers to seize the opportunities offered by globalization.

Paid annual leave is arranged between Articles 53 and 62 of Labor Law, No. 4857, and relevant procedures and principles are set out by the Regulation on Paid Annual Leave.

Who Decides Who is Taking Vacation and When?

For workplaces employing more than 100 employees it is obligatory to constitute an “Annual Leave Committee,” comprised of representatives of employers and authorized for planning paid annual leave. Planning may be made by employers or employers’ representatives or persons authorized by them in other establishments.

Written requests for entitled paid annual leave should be submitted to the employer at least one month prior to the date at which employee wish to start his/her paid leave.

Employer is not bounded with the start and end dates of the leave demanded by employee, and may determine different dates by taking into account the continuity and regularity of operations in general, order of precedence as regard to seniority, or the special issues pertaining to employer's workplace. But that does not mean employee cannot take his/her paid annual leave in the relevant year.

Employees are allowed to take some days off on some occasions such as marriage, birth, death, adoption etc. Remuneration of these leaves shall be paid by employer, and such leaves shall be regarded as worked in computation of the length of service required to qualify for paid annual leave.

Termination of employment contract, either by employee or by employer is subject to strict rules arranged in Labor Law.

Especially the employer should be more careful and take the following points in the execution of termination.

§ Notice of termination must be in written,

§ The exact reason of termination should be explicitly notified to employee,

§ In case misdemeanor of employee, this act must be documented. Statements must be taken and appended to an official report,

§ Employee's defensive statement must be taken. If employee refrains from giving statement, a notice should be sent to employee through a notary public.

Prescription period for execution of termination

Prescription period is 6 working days.

The right to break the employment contract for the immoral, dishonorable or malicious behavior of the employee may not be exercised after six working days of knowing the facts, and in any event after one year following the commission of the act, has elapsed.

“This article is published in “Dünya Executive,” the weekly English supplement of financial newspaper Dünya, on 31st May 2017. We have tried to shed light on the problems frequently encountered by the foreigners in our country.”

Being an expat is something like an adventure involving so many problems to cope up with. That means too many questions to be answered on the matter, that’s why we are going to confine ourselves to legislative side such as work permit, tax law, labor law and social security status of expats in this article.

Permission to work in Turkey

Q. 1 - Is it compulsory for the foreigners to get work permit before starting to work?

A. 1 – Yes. Foreigners are obliged to get permission before they start to work dependently or independently in Turkey. Provisions of international agreements to which Turkey is party are reserved.

Q. 2 – How to apply for work permit?

A. 2 - Foreigners residing out of Turkey make their work permit applications to the Republic of Turkey representations in their home country or any country where they have valid residence permit.

Foreigners who have valid residence permission in Turkey are entitled to make their application directly to the Ministry.

Q. 3 - Can an expat work in any workplace with the same work permit?

A. 3 - Foreigners are granted work permits to work in a specific workplace, the permit loses its validity when they quit this specific workplace. The company who wish to employ the foreigner should apply for a new work permit or transfer the work permit before date of expire.

In the unionized workplaces the daily amount of earnings subject to premium that will be taken as a base in the minimum wage support is increased from 110,00 TRY to 164,70 TRY.

“AUnionized workplace” is the workplace in which collective agreement provisions are applied.

As is known, employers are receiving daily 3,33 TRY premium refund throughout 2017 for each worker whose wage (earnings subject to premium) were notified under daily gross 110,00 TRY (monthly gross 3.300,00 TL) in 2016, and for each personnel employed in new enterprises established / registered within 2017. (Cabinet Decree: 2017/9865, issued in the Official Gazette on 22 Feb. 2017).

Now with the Cabinet Decree, 2017/10326, issued in the Official Gazette on 20th May 2017, numbered 30071; starting from 1st May 2017 daily base amount for government support is increased to 164,70 TRY in the unionized workplaces.

Arguments over severance payment system have a long background in Turkey; and it still constitutes the most controversial issue between labor and employer representatives.

Starting from 1975 a severance payment fund, intended to reconstruct the still prevailing system, occupied the agenda during the last 42 years.

When the Labor Law No. 4857 entered into force on 2003, its transitory article 6 stipulated that severance fund should be established to replace the current system, and article 14 of abrogated Law No. 1475, which arranges the severance payment stayed in force until now.